Recent Price Movement and Market Context
The stock has experienced a consecutive four-day decline, resulting in a cumulative return of -5.27% over this period. Today's fall of 1.07% further extended the downtrend, underperforming its sector by 0.76%. Piramal Pharma is currently trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, signalling sustained weakness in price momentum.
In contrast, the broader market index, Sensex, opened flat but is trading marginally lower by 0.13% at 84,450.41 points. The Sensex remains close to its 52-week high of 86,159.02, trading above its 50-day and 200-day moving averages, indicating a generally bullish market environment that Piramal Pharma has not mirrored.
Long-Term Performance Comparison
Over the past year, Piramal Pharma's stock has recorded a return of -36.73%, significantly lagging behind the Sensex’s 5.34% gain during the same period. The stock’s 52-week high was Rs.273.20, highlighting the extent of the decline to the current low of Rs.165.05. This underperformance extends beyond the last year, with the stock also trailing the BSE500 index over the last three years, one year, and three months.
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Financial Metrics Highlighting Current Concerns
Piramal Pharma’s financial data reveals several areas of concern. The company’s Debt to EBITDA ratio stands at 3.83 times, indicating a relatively high leverage level that may constrain its ability to service debt efficiently. This is compounded by a low average Return on Equity (ROE) of 0.32%, which suggests limited profitability generated from shareholders’ funds.
Net sales have shown modest growth over the past five years, with an annual rate of 9.15%. However, recent quarterly results for September 2025 indicate a decline in key profitability metrics. Profit Before Tax excluding other income (PBT LESS OI) was reported at a loss of Rs.111.78 crores, reflecting a fall of 340% compared to the previous four-quarter average. Similarly, Profit After Tax (PAT) registered a loss of Rs.99.22 crores, down by 613.2% relative to the same benchmark. Net sales for the quarter were Rs.2,043.72 crores, down 10.5% from the prior four-quarter average.
Valuation and Profitability Insights
Despite the challenges, the company’s operating profit has grown at an annual rate of 23.29% over the long term, indicating some underlying operational strength. The Return on Capital Employed (ROCE) is recorded at 2.7%, and the Enterprise Value to Capital Employed ratio stands at 2.2, suggesting a fair valuation relative to capital utilisation.
Nonetheless, the stock is trading at a discount compared to its peers’ average historical valuations. Over the past year, profits have declined by 158.7%, which aligns with the stock’s negative return over the same period.
Shareholding and Market Position
Institutional investors hold a significant stake in Piramal Pharma, accounting for 45.17% of the shareholding. These investors typically possess greater resources and analytical capabilities to assess company fundamentals, which may influence market dynamics around the stock.
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Summary of Performance Trends
The stock’s recent performance reflects a continuation of a downward trajectory that has persisted over the last year and beyond. While the broader market indices maintain a positive stance, Piramal Pharma’s share price has moved contrary to this trend, influenced by its financial metrics and valuation considerations.
Trading below all major moving averages, the stock’s technical indicators align with the fundamental data pointing to subdued profitability and elevated leverage. The quarterly results further underscore the pressures on earnings and sales, contributing to the current valuation levels.
Investors and market participants will note the contrast between the company’s operating profit growth and the declines in net profits and share price, highlighting a complex financial profile.
Market Outlook and Positioning
While the stock has reached a new 52-week low, it remains part of the Pharmaceuticals & Biotechnology sector, which continues to attract attention due to its strategic importance and growth potential. Piramal Pharma’s valuation metrics suggest it is trading at a discount relative to peers, reflecting the market’s assessment of its current financial standing and performance trends.
Given the stock’s high institutional ownership, market movements may also be influenced by broader portfolio adjustments and sectoral shifts within the investment community.
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